Dermatology Medical Billing Made Easy: Best Practices and Solutions

Dermatology billing is uniquely complex, and mistakes can cost your practice thousands in lost reimbursements; that’s where effective dermatology billing services come in.

Unlike some other medical specialists, dermatology practices offer a blend of procedures, some of which are covered by insurance and some that aren’t, making medical billing for dermatology difficult.

In an effort to balance individualized patient care with maximum reimbursements to secure the financial health of a dermatology practice, you might be wondering if it’s better to outsource dermatology billing services to a third-party company or keep this critical task in-house.

In this article, we’ll outline the top medical billing challenges that dermatology practices face and reveal best practices for securing maximum reimbursement to increase your financial bottom line as a healthcare provider.

The Challenges of Dermatology Medical Billing

The job of a dermatologist is difficult enough without having to worry about whether your medical coding is being done accurately and whether your medical coding services are optimizing revenue.

Not only do dermatologists have to be diligent about detecting skin conditions and helping patients with both cosmetic and medical decision-making, but they also have to ensure that billing is done correctly.

It can be tough for a dermatology practice to master medical billing, but it’s not impossible. Once you understand the most common challenges, you’ll be better equipped to overcome them.

Complex and Ever-Changing Regulations

Generally speaking, dermatology procedures deemed to be a medical necessity are covered by insurance, and elective and cosmetic procedures are the financial responsibility of the patient. That seems straightforward, but there are gray areas within this framework – like having a mole removed.

To make matters even more complicated, the rules change regularly, and it’s up to the office’s medical biller to stay current on these changes, especially when it comes to medical coding. In addition to changes and updates to coding, there could also be new regulations that must be adhered to at the state and local level.

Chasing Payments from Patients

If you thought getting reimbursed for a claim to an insurance company was an obstacle, be prepared to start chasing your patients, reminding them to pay for their dermatology service. This can be especially difficult if there is any miscommunication about what insurance is obligated to pay for and what the patient owes.

Medical billing services offered by a medical billing company can be invaluable in aiding collections, but if you’re using an outside service, those costs can eat up profitability. An in-house medical biller can also perform these tasks, and their efficiency is greatly enhanced by having an effective medical billing software solution.

High Volume of Claims

A busy dermatology practice is bound to have a mountain of claims to prepare and submit to the insurance company for reimbursement. To streamline the claim submission process, it’s a good idea to verify the insurance coverage a patient has before recommending a treatment plan or performing a procedure.

Further, documenting everything thoroughly and promptly can help save time later. Instead of trying to track down records or patient details, you’ll have everything you need to complete the claims and billing process at your fingertips.

High Risk of Denials

A litany of factors can lead to a denial of payment by insurance companies, including:

• Failing to adhere to medical coding guidelines
• Performing a procedure that wasn’t covered by insurance
• Submitting codes (including dermatology CPT codes) past the deadline
• Not completing credentialing services properly
• Using an outdated dermatology modifier (Be sure to triple-check each modifier before submitting a claim)

As you can imagine, having even one claim get denied can deliver a revenue blow to your dermatology practice. When claim denials are routine, it can be catastrophic. A common trap that a dermatology medical billing service provider can easily fall into is a modifier that’s designated for existing patients rather than a new patient to the practice.

A dermatology industry benchmark is a successful claims ratio of 95%. It’s believed that anything under this amount indicates a significant loss in revenue, not only in claim denials but also in the time your staff and dermatology medical billing services team have to spend reworking the claims.

Best Practices for Dermatology Medical Billing

Understanding the best practices for dermatology billing can result in an instant increase in revenue for your practice while saving valuable staff time, which can boost morale and efficiency.

We recommend incorporating the suggestions discussed below.

Accurate and Complete Documentation

Attention to detail and careful documentation at every step of the journey, from the initial diagnosis to the necessary procedures and the approved treatment plans. By having a solid foundation of documentary evidence, you’ll be in a better position to ensure you’re able to code accurately and get reimbursed on time and in full. 

When determining the best course of treatment for a patient, discuss and document medical necessity, including patient history, pre-existing conditions, and the reason for the dermatologist’s recommendation. And, when it’s time to create a bill, be sure it’s accurate.

Proper Coding

Being familiar with current coding guidelines is essential for successful dermatology billing, and it often requires continuing education and training.

While it’s beyond the scope of this article to provide a complete tutorial on dermatology coding, a brief overview here can serve as a helpful refresher. First, there are two main types of C to be aware of:

1. Current Procedural Terminology (CPT)
2. International Classification of Diseases (ICD-10)

Different skin-related conditions can fall under a single code, and, conversely, a single skin condition can have various codes to choose from. The American Medical Association keeps a database of coding resources, including the most recent code sets, which is a valuable asset for medical billing experts and beginners alike.

Another red flag for a coder to be aware of is the difference between an excision and a skin biopsy procedure for medical billing. As a reminder, a biopsy removes only a small tissue sample, and an excision removes an entire section of skin that includes a growth or lesion.

While a dermatology practice may be reluctant to bill for everything for fear that a claim will be denied, under-coding is also a significant problem. Under-coding occurs when a dermatologist treats several related skin conditions but only bills for one procedure using a single CPT code.

By taking some time to ensure your medical billing service team understands the right codes to use (and when), you can achieve maximum reimbursement.

Timely Submission of Claims

Dermatology offices have enough on their plates without having to worry about risking reimbursement for lack of a timely submission of claims. However, being timely should be a top priority. Delay leads to errors and claims falling through the cracks. If you wait too long to submit a claim, you risk having claim reimbursements stalled or denied altogether.

While some offices choose to hire certified professional coders or outsource their medical billing services, forward-thinking offices appreciate the value of keeping these tasks in-house, as long as they have the right medical billing software to assist them.

Effective Follow-up

Whether you’re following up with insurance companies or patients, staying on top of this level of communication is vital for successful collections. You must have a clean database that has current patient information, along with a system in place for both automated and manual follow-up.

If your dermatology practice is disorganized, you may miss out on opportunities to bill patients and leave significant revenue on the table. We recommend that a practice update insurance information regularly, collect payment at the time of the procedure (when applicable), and proactively follow up on any unpaid claims.

A system like Weave Payments can help you collect more payments, faster. Features include online bill pay, text-to-pay, manual card entry, financing options, and more.

Stop letting unscheduled treatments walk out the door because of cost and sign up to become a CareCredit provider directly through Weave today. Give your patients the flexible financing options they need to accept care, and empower your staff to seamlessly process those payments right within your existing Weave workflow.

An All-in-one Dermatology Billing Solution: Weave

If you’re ready to take control of your dermatology practice billing without having to rely on a third-party professional coder, you’re in good company.

83% of healthcare providers that implement Weave can collect money faster while saving time on coding services and billing procedures. One practice, in particular, saved more than 30 hours a week on billing while making payments for patients much more convenient.

To see how Weave can replace your current dermatology billing service, schedule a demo today.

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